Ventas Inc. plans to purchase privately held hospital chain Ardent Medical Services Inc. for a whopping $1.75 billion in cold cash. The acquisition will give Ventas 10 Ardent hospitals with about 2,045 beds, hundreds of physicians, tens of thousands of employees, specialty physicians and pharmacies. This greatly enhances Ventas Inc. portfolio as one of the biggest health care real estate investment trust companies in the industry.
Ventas’ shares were up 2 percent at $74.74 in premarket trading on Monday. Ventas will split Ardent’s real estate portfolio from its hospital operations. Afterwards it will sell the hospitals to a new company owned by current Ardent management and other equity sources. Through this financial strategy, Ventas will retain up to 9.9 percent of the new company. The transaction is expected to add 8-10 cents to Ventas’ funds from operations per share in the first year after the transaction closes. This deal is expected to close in mid-2015.
At present, Ardent owns 12 acute-care hospitals, a rehabilitation hospital, three multi-specialty physician groups and retail pharmacies. On the other hand Ventas, which owns seniors housing communities, medical office buildings, skilled nursing facilities and hospitals, also plans to create its own portfolio of skilled nursing facilities. This is expected to be completed in the second half of 2015.
“The addition of Ardent’s platform, which includes high-quality assets with significant market share in three key markets, and a highly-regarded hospital management team, creates a strong avenue for growth in the attractive hospital real-estate market,” Ventas Chief Executive Debra Cafaro said.
About Ventas Inc.
Ventas, Inc. is an S&P 500 company, is a leading real estate investment trust (REIT), with a highly diversified portfolio of more than 1,600 seniors housing and healthcare properties in the United States, Canada and the United Kingdom. Ventas has delivered consistent, superior long-term returns to shareholders for a lot of, outperforming both the S&P 500 and the MSCI US REIT Index. By maintaining an outstanding balance sheet and ample liquidity, Ventas strives to improve the cost of capital and enhance stakeholder value. Ventas Inc. stock market evolution: http://www.google.com/finance?cid=663130
About Debra A. Cafaro
Debra A. Cafaro is Ventas, Inc. Chief Executive Officer since 1999 and as our Chairman of the Board of Directors since 2003. Under her leadership, Ventas’s market capitalization rose to nearly $25 billion, from $200 million. Additionally, Ventas was named the top performing publicly traded financial company for the first decade of this century and Fortune Magazine ranked it as one of its “Most Admired” real estate company globally in 2013. Ms. Cafaro was recognized in 2014 by the Harvard Business Review in its list of “The Best-Performing CEOs in the World,” ranking her in the top 30 global CEOs and by Crain’s Chicago Business as one of the “Most Powerful Women in Business”. She was also named one of the “100 Most Influential People in Healthcare” by Modern Healthcare.
Ms. Cafaro received her J.D. cum laude in 1982 from the University of Chicago Law School, where she was named its Distinguished Alumna in 2011, and her B.A. magna cum laude from the University of Notre Dame in 1979.
About Raymond J. Lewis
Raymond J. Lewis has been President of Ventas since 2010. He previously served as Executive Vice President and Chief Investment Officer from 2006 to 2010 and as our Senior Vice President and Chief Investment Officer from 2002 to 2006. He is also currently a member of the Executive Board of the American Seniors Housing Association where he serves as Secretary and Treasurer on the Executive Committee. Mr. Lewis is a graduate of the University of Wisconsin.
About Ardent Health Services
Ardent Health Services is a national health care company with headquarters in Nashville, Tennessee. Its subsidiaries own and operate hospitals and multispecialty physician practices in three states plus a number of retail pharmacies. Within the industry, Ardent is known for recognizing that every hospital is unique as it serves. Ardent is also known for our investments in people, facilities and technology. As a premier provider of health care services, Ardent seeks highly qualified, highly motivated employees. The Ardent Health system currently includes a total of 13 hospitals in 3 states, 3 multispecialty physician groups employing 325 physicians, 12,000 employees, 11 retail pharmacies, $1.9 billion in revenues projected in 2014 and $701.5 million in capital investment in three systems since acquisition. Ardent is led by President and CEO David T. Vandewater and supported by the financial strength of Welsh, Carson, Anderson & Stowe, the leading private equity investor in the health care industry.